Greece has been around a long time. Greece predates Europe. The Greek citizen invented the Senate. The Senate did not invent the Greek citizen.
The current state of affairs in Greece is due, in part to Government ownership--In part. The other part is the notion that when the Government owns everything, everyone owns everything. This is the failed Soviet Style of Communism. The reality is that when everyone owns everything, no one owns anything.
With the Greek Citizen—with no vested interest, there is no interest.
Do you dispute me? I shall refute you.
How hard is the Greek worker fighting for his benefits?
Because his benefits belong to him.
Privatisation is not a dirty word.
While every plan for Greece has involved a bailout, none has involved any capital investment or economic development.
In a recent NY Times article, “The IMF “traditionally” said cutting budget deficits is the solution to the problem. Mr. Summers said Mme Lagarde’s reversal is a welcome change in thinking, emphasizing that we should be establishing a basis for growth.” I assume Mme Lagarde and I are the only two people saying this. Or, perhaps Mme. Lagarde is the only person reading my blogs. Madame goes on to say, “…the markets realize that commitment to cut spending cannot survive a lengthy stagnation.”
The best option for Greece (I have a project not a plan.) is a major economic development project that changes the process.
Let us be honest. The EuroCrats are intelligent, educated, and experienced. Why then have they failed to solve or even mitigate the damages or ameliorate the problems? By the process of elimination, the problem is the process. That must change. In Greek: Δ
The first startling example is that what the EuroCrats are doing to the Greek People can be called “poverty programmes”. The Greek People need “Prosperity Programmes”.
As an aside, I thought that warning of a move to the “right’ would be a consequence for Greece if the problem can’t be solved soon was an overstatement. Then I remembered some American political math. It is analogous.
Dems control Congress + Jimmy Carter = Ronald Reagan.
Dems control Congress + Bill Clinton = Republican turnover in Congress.
Dems control Congress + Barack Obama + Massive GOP turnover in House of Rep.
Okay, I concede. The Greek people can fix the problem now while it is small (by comparison) or wait till there is a real disaster. But I digress.
The difference between the aforementioned Soviet Style Communism and Chinese Communism (Aside from the failure of the former and the success of the latter) is China’s Middle Class.
The divestiture of Greece’s State Owned Assets is crucial to the turnaround in Greece. A limit on foreign ownership of shares in the newly minted, publicly traded companies is also essential.
Some of those assets may include but are not limited to:
With the Greek Citizen owning the asset, the Greek Citizen will have a vested interest in its success. There will be a profit incentive.
Greece; Influx of Tax Revenue without increasing taxes
Relief from Debt and the crushing interest rates
Benefits of the multiplier effect
Reduction in Lenders: Increase in Investors
Increased Capitalisation of Banks
What has been the alternative so far?
The Greek Government
Cut State Salaries
Plans to cut jobs and cut pensions again.
Greece still has problems. Why? Because The Greek Government
Cut State Salaries.
Someone then told the Government that by lowering wages tax revenues will fall. The Government solution to this was to fire people. This caused a further decline in revenue. To address this, the Government increased property taxes on the unemployed and underpaid. And all of this is the result of Austerity measures imposed on Greece by the EuroCrats who were working to solve the problem. Call me a flawed human being, but I believe the EuroCrats have failed in their mission.
Union busting will not solve the problem.
Labour strikes will not solve the problem.
Firing people will not solve the problem.
Taxes will not solve the problem.
[No country ever taxed its way to prosperity. The mantra during the first two years of Bill Clinton’s first term as President of the United States.]
For further information, please read my blogs on the matter.
Copyright © 2011 Slim Fairview
The Multiplier Effect:
the Future of the G 20 in Good Times and Bad
China: The economy and a word beginning with the letter P